Dr. Forbush Thinks

In the United States everything seems to be about money, except when it isn’t. If Yogi Berra didn't say that, he could have. But, the point is that money, capital, market rise and prosperity is the language of America and capitalism. We saw this when the Soviet Union collapsed; capitalists were standing on their soapboxes proclaiming the strength and power of the capitalist system.

Of course I believe that capitalism is a motivating factor. People desire the easy life, and one sure way to an easier life is having money in the bank. The dream of resting on your laurels and having the world be your oyster has long been the American dream. It is certainly hard to argue with the fact that people can be bent to do the right thing if money is offered in exchange for it.

Not all cultures operate on this principle. Some cultures value family more than money. Some cultures value religion more than money. Some cultures value the well being of society more than money. But, here in American although you may find some minorities with these skewed and warped values the majority of Americans value money above all else.

One minority in the USA that has been fighting an uphill battle are the environmentalists. These crazy people have determined that the environment that we all live in deserves a high value. So, instead of worrying about the cost to corporations, industry or just plain folk who want to drive big SUVs they are concerned with the possibility that our environment might possibly become unlivable for our future generations.

Well, in the American culture it is quite clear that priorities should ensure that we have enough money before we start spending it on the future generations. After all, if the environment is destroyed we would have wasted all this money spending it on people who would never have been born anyway. What a silly waste of money!

Another minority that doesn’t see things the same way as the majority of Americans are the people who want to make sure that the average working stiff has enough money to live on. These people are as crazy the environmentalists. They want to spend money on people who don’t have enough gumption to get a real job that pays real money. They don’t have the network of friends and family to make the connections to get that job, so they must not really be worth anything anyway. And, these crazy people want to spend money on these poor slobs. Can you imagine that? This minority really believes that if people are sick they should be taken care of even if they can’t afford to pay for it. Maybe if they took out a loan or something and their family promised to pay it back after they died it might be fine. But, can you really imagine wasting money on these people?

It sure is a good thing that these people are in the minority here in the USA, because if they weren’t we might end up with a system like they have in Europe. It turns out that in Europe people who care about the poor, the working class and the environment are in the majority. In Europe they value people and our planet more than money. So, in Europe they spend money to make society a better place for everyone. It sure is a good thing that we don’t have a majority of crazy people like that in our country.

Can you imagine how bad the European economy must be doing with these crazy people spending all this money?

The strange thing is that at first there were problems getting everything in Europe working. They had high unemployment rates and lots of issues with getting services to everyone that needed them. But as time went on things seem to have worked out quite well. And, yesterday I read that the value of the European stock market has surpassed the value of the US stock market for the first time since World War I.

So, what does that mean to me?

Think about the history of the twentieth century for a moment. Europe experienced two very destructive wars that destroyed not only people and property, but entire infrastructures and industries. If you owned a company that was doing pretty well in 1905 but it was destroyed in the Great War then the value of that company had fallen quite a bit. In some cases only the intellectual property, i.e. the recipes and secret formulas remained. If you own stock in a company, that means that you own a fraction of the company that had lost quite a bit of value.

The value of a stock market is the total value of all the companies listed on the market. Since the bombs and bullets were kept on the other side of the ocean during this war the United States was able to preserve its industry and infrastructure and the relative values of the two markets reversed. And, just as Europe began to rebuild the value of its markets by rebuilding companies and infrastructure it was hit with another war. This war was arguably even more destructive than the first. And, during this time the United States was able to build even larger and more robust companies that were still untouched by the bombs and bullets across the sea.

In the United States we value money as I said before. This means that if I buy stock in a company I expect that the value of the company to go up so that the value of my stock goes up. The value of the company is reflected in how much profit the company can make, the value of its intellectual property and value of its assets and property. This is determined by how much a potential stockholder is willing to pay for a share of stock.

Let us assume that the two groups of markets, in the US and in Europe both started out at the same value after World War II. We know that they didn’t, but let us assume that they did. If we assume that both markets operated freely then we could assume that they might grow at approximately the same rate; if all things were equal.

But, all things were not equal. In Europe the value of their stock market was much below the value of the US markets. And, on top of that the people in Europe decided that some things were more important than money. They created a National Health Care system in each of the nations. They consisted of many different nations that had tariffs and prejudices with each of the other countries. They also taxed their gasoline at an enormous rate in order to protect the environment by forcing people to use the fuel as efficiently as they could. And, they created a system of worker’s rights to protect the average worker from being exploited by their employers.

So, based on these facts it would be nearly impossible for Europe to manage to continue it growth at the same rate as the United States. And, since European growth would need to exceed the United States growth for a substantial number of years in order for Europe to catch the United States we should have been able to predict that Europe could never reach the United States in economic value in any measure. But yesterday, we found out that they did. And, they did it with out putting money as the most important priority. Instead they caught the US and they continued to value people more than money all the way to the bank.





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Don't forget what Stephen Colbert said, "Reality has a well-known liberal bias."


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